-- what is in it for scott underwood? scarlet fu has already watched the first episode of "house of cards was quote season two. and diamonds are forever at least on valentines day. i am so cynical, it is sick and terrible. >> happy valentine's day. >> this is "bloomberg surveillance." we are live from world headquarters in new york. it is valentine's day. i'm tom keene. joining me are scarlet fu and adam johnson. adam, happy valentine's day. thank you. give me a brief. what have we got? >> feeling the love. >> happy valentine's day, thank you bit >> time for the morning brief. overnight the euro area economy expanded more than forecast in the final quarter of 2014 -- 2013, easing pressure. and little bit of good news. euro gdp up about 0.2%, and here in the u.s., our gp -- gdp is up 3.2%.

see the difference? germany, france, and the netherlands all beating the forecast. the italian government grew the 10th of the percent. assuming there is still an italian government. more on that later. i don't mean to be so cynical. china's consumer prices, meanwhile, that rose about 2.5% and producer prices fell 1.6%. 8:30 a.m. in the u.s., import prices and 915 a.m., industrial production and capacity utilization and finally the university of michigan consumer confidence. that is actually a big deal. earnings before the bell. campbell soup. mm mm good. >> let's get to this quickly. lots to talk about especially on time warner cable and comcast bid futures are flat. 10 year yield floats above 2.7. the euro stronger again off of the better gdp data. out to 1.38.range

stronger euro. let's go to foreign exchange. better thanvix, good? gold launches over 1300 a share. and, scarlet, chocolates at 10:00 a.m. after "bloomberg surveillance." coco is up today. >> are you going to buy scarlet hot cocoa for valentine's day? or the real deal? >> stop talking about it. just do it. >> see the cynicism? >> we are on a cynical tear, and must be dealing with ice day in and out. >> scarlet's husband got her a -- a zamboni for valentine's day. let's look at the valentine's day front pages. some theories news. >> the fallout from comcast buying time warner. it goes beyond the traditional antitrust review where regulators look at what it creates too much concentration

and a certain market. instead, the negotiations will likely focus on the effect on internet traffic and how online video is handled. for instance, comcast can put excessive charges on providers like netflix and you wonder how it sets things up for the ever-changing tv industry. here is an interesting side note. it only took six days for the deal to come together. comcast ceo brian roberts was negotiating from sochi. >> $45 billion deal and it takes six days to come together. that is a man with a vision. >> also, i believe the cfo as well, really upset at charter. in the articles that you and i have read, there is real animosity about charter. >> specifically, john malone. they wanted him to pay more and he said, well, i am not going to pay a whole lot more and as i understand these articles, it sounds like there was some sort of brouhaha that finally got to the boiling point, they walked out and went to comcast.

pushbackl look at the this morning. some great guest. >> our second front-page story comes from bloomberg.com. 401k's may have gotten fatter after the record rally in equities but companies are putting the squeeze on these employee retirement accounts. companies like whole foods, facebook, oracle, jpmorgan, ibm. the way they are doing it is by holding back on the amount of matches and setting lower limit for maximum payments for any given account. bloomberg analyzed all this data from government filings and this is what we found. this is critical because a difference of something like three percentage points could eventually mean hundreds of thousands of dollars when you, adam johnson, decide to eventually retire. dealis is a very big because, as you point out, there is the compounding effect. you can't help but wonder, companies pushing back saying, look, we've now got the health-care issue. we have to spend more money on health care. either way, a lot of companies are changing the way they do.

looking at ups, no longer offering health care for spouses and unemployed, so it is all related. >> and it is happening incrementally throughout the years. >> the last front-page story going back to the weather and hopefully no one has to fly out anywhere right away because airlines are trying to regroup after the most cancellations offense hurricane sandy back in 2012. more than 71 hundred flights scrubbed yesterday on top of the 4100 canceled on wednesday. that is equivalent of 80% of partners of the two washington airports and charla's airports. jetblue in new york has been the most heavily affected, really concentrated in new york and boston. >> without question, we are seeing it in the economic data. fliflow injure -- burt ckenger will join us about retail. >> breaking news, joseph a bank will be buying eddie bauer in cash and shares. it is going to start at $65 a share -- joseph a bank buying

eddie bauer in cash and shares and it will include a termination fee of less than three percent of the equity's value. these are the headlines coming up. they also have some numbers in terms of adjusted eps for 2014, from $3.20 per share up to $3.40 per share. the time warner and comcast deal but it is fascinating. eddie bauer -- may i editorialize? adam, help me here, how long? a very long time. i remember when they had to shut down the store on madison avenue because there was not in the business. who are the guys and make the fluffy ugly boots? s. -- ugg >> you are wearing a pair. >> i'm not wearing uggs. >> $554 million deal, that is what it works out to.

>> men's wearhouse to by joseph a bank, no, it is a bank by when -- men's wearhouse, no, then enough of it, we will go by eddie bauer. >> our guest host, marshall sonenshine has seen it all. from time warner cable, disney, abc, comcast, the big boys, and maybe we can also get a comment on him as joseph a bank jake -- takes out eddie bauer. what is the why? eddie bauerbank at is really hard for me to add to what you said because eddie foul has been long a tarnished brand. joseph a bank itself is a discount brand with a good ups -- upscale image. what i do think is interesting about this particular deal. this is small relative to what we are looking out -- looking at. this is yet another strategic deal. m&a isw my schtick -- strategic and not financial. >> it is valentine's day. we need some math. let's go to the screen here. i lost it. oh, my word.

there it is. roberts.here to brian this is department of justice. small start up operation in washington. , -- they haveying an index which is at&t and worstle's most best nightmare. constantine, bring on the valentines map for marshall sonenshine. this is a big deal. this is something every cfa learns, marshall sonenshine teaches it. roberts's worst nightmare. ruse nailed it in new york magazine. this is more consolidation in at&t and t-mobile according to him. >> i am not sure if it is true. with all due respect, i want to take the other side for a moment. first, i want to be clear, you hl at learn about herdfenda

brown but you learn about law breyer,- judge stephen my professor. it is long been a staple of antitrust analysis and it is in a portal but not the only tool. in this particular situation, comcast has already agreed to divest 3 million -- >> getting out in front. >> absolutely. secondly, comcast which has experimented a little bit in some smaller markets with the idea of holding back some services on the speed of transmission which is what net neutrality is all about, comcast knows it will cut a deal with the fcc which lost a round in federal court in washington over net neutrality. federal court in washington said we don't need net neutrality but, guess what, the fcc i think will cut a deal with comcast saying we will protect this. roberts, most important employee this morning as melissa the chief lobbyist in washington, they had a

conference call yesterday. what is their number one task against ed markey, chuck schumer and all of the others pushing back against this transaction? >> sell the deal by positioning it as not bad but actually good for consumers. >> why is it good for consumers? >> first of all, i don't think her friend all matters that much of the market place like this where cable companies do not compete in markets, they have their own monopolies. got it. they were pretty powerful and they have been close to 30% before. that is not what this is about. this is really about how is content being distributed with reference to not just cable but also satellite and other modes of transmission including, by the way, the web. >> fascinating, diverse push back. >> would have to get into this a little later on but we do want to bring you headlines and company news. when a charter communication left in the dust with the tidy up -- tie up. and john malone, a mr. libby global.

the cable company reported fourth-quarter sales below analyst estimates. sales increased 71% thanks to a string of acquisitions, including a buyout of virgin media. japanese internet retailer rakuten the visual distribution buying an internet messaging service for $900 million. give the company is distributional channel for it digital products. job cuts at aig, eliminating 1500 jobs, about three percent of the staff. the cuts will come from the property-casualty unit and will reduce earnings by $255 million before taxes, according to the company. >> you mentioned chartered -- we will talk about that and a bit. goldman sachs, another loser in this transaction. >> goldman sachs not one of the advisers. jpmorgan one of the winners and -- cul-de-sac stopping to ace --

goldman sachs dropping to 8th. 160%, theber is increase of netflix's share price and the first dared house of cards. how it affects the bottom line, coming up on "bloomberg surveillance." ♪

>> good morning, everyone. "bloomberg surveillance." in on the, chad goodste merger, former ovation tv chief operating officer -- chad gutstein. this is "bloomberg surveillance ." i'm tom keene. with me, scarlet fu and adam johnson. spoiler alert. >> we will stay on the continent seen. i already know what i am doing

this weekend. two and half hours ago, netflix served up season two of "house of cards." i am not giving away any spoilers but they also announced a third season to follow. we don't know how many people watch "house of cards." they don't say anything about it. stock price has reacted positively and netflix gained a lot of surprised -- subscribers because of "house of cards." what is interesting is how netflix moves forward with other programs, other original content, because they need to bring down the content costs which is in excess of $7 billion the next couple of years. >> kevin spacey is expensive, right? not agot a back end deal, lot of money up front. >> william shatner deal -- >> $100 million per season one. ordered it, sight unseen. that was the cost to produce it. they committed to it. they heard about the concept is

that we are on board because the big data analysis showed them a political thriller involving human species would be a big hit. "surveillance" analysis, we have to cut to someone -- go to someone cut and shouldered -- chiseled. phil mattingly. spoiler alert. scarlet would not speak to you again if you let it out. howl house of cardsy is watching tim? >> they even started petitions on tuesday when he recognized it would be a snow day, to get them to release "house of cards" a day early. top washington officials just assume that netflix is going to have to respond to a couple hundred washingtonians who want to watch it early. i kid you not. i have staffers e-mailing me since 3:00 and 4:00 in the morning, everybody waking up. government does not open until 10:00 a.m. this morning, meaning everybody getting an x to jump on it, tom. big deal down here. >> you talk to a couple of

people about what they thought about "house of cards." what did they tell you? >> we took a camera and we wanted to see what lawmakers had to say about "house of cards." take a listen. >> the only unrealistic thing about the show is a democrat could represent gatsby, south carolina, it will never happen. >> unfortunately i think kevin spacey makes it look a lot more exciting than it is an allotment devious, but will be interesting to see what they do with the new season. >> he's probably a composite. none of us are quite that interesting. >> i am one of the few living americans who has not watched it. guys him and not just the staffers watching up at all the lawmakers as they head out of town this weekend they claim they plan on spending this week and binge watching this like anything else. this -- and you know a lot more about this than i did -- the morality, or the ethics.

the cynicism. how does a fold over to washington? tell me it ain't so. >> i think it goes a little extreme. i think everybody with a technology may be a little bit further dan where -- what it actually is. and not everything is so planned out in d.c. \ they make it seem like that there is a puppetmaster. you really need to watch the house republican conference to recognize these people do not have everything planned out 5, 6 that's ahead. a lot of times they are making things up as they go. very entertaining. also something else. not just capitol hill pays attention to it of the white house as well. president barack obama ossie official organizing fractions would account weeded out "house of cards" no spoilers. no spoilers for you and me but i will give you guys one little hint -- late in the entire season, keep an eye out, my colleague white house cheaper sponsor extraordinaire julianna goldman makes an appearance, according to sources familiar

with the show. >> phil mattingly, thank you so much pretty important bloomberg television information. you love it. >> that content chief guy over at netflix says the show has international appeal. not just in washington. greed and corruption, of course, that is a very global theme. >> you know what it is? these people are just so manipulative, and you see celebrate -- you celebrate them, right? they do the nastiest up and you love them. >> and you get -- they get things done, not like in washington. on the cover of the next "bloomberg businessweek" we talk about the new minimum wage -- the fight over the new minimum wage. this is "bloomberg surveillance" on bloomberg television, on your tablet, smartphone, and bloomberg.com. ♪

>> it is lantern festival in asia, the end of the celebrant -- new year celebration. a live shot out of taipei with the taiwanese president leading the lantern festival. a lot of revenue there. we're not when read in new york and >> art of the chinese new year? >> the end of the lunar new year festival because lunar new year began and you go 14 days and many of the lantern festival and everyone moves on with their lives. >> i make a joke of it, it is the year of the doughnut. what is it officially? >> year of the horse. >> on the horse means exactly what in this context question mark >> the chinese zodiac. strong, steady? >> i am not a horse so i don't keep track of it. >> the horse is expensive. >> it will be a debt year.

>> good morning. a valentines "bloomberg surveillance." we have top headlines with your valentine, adam johnson. >> europe's to business -- two biggest economies top forecaster to gnp in germany grew zero point four percent in the period and france posted a 0.3% gain and both have been slightly better the forecasted exports help drive the growth, especially in germany. france's pickup in domestic consumption boosted that economy. italy mina -- meanwhile getting a new government yet again. prime minister enrico letta is out, giving into pressure from his own party and his resignation is expected to clear the way for his political rival matteo renzi and he will try to form a government. enrico letta lasted just 10 months as prime minister. president obama is offering millions of dollars of aid to california farmers, ranchers, and communities hit by one of the worst droughts in the state's history. the drought has forced farmers to leave thousands of acres idle and the state may have to truck in drinking water for some communities. >> a whole new level.

i saw a snow chart yesterday that showed the snow destruction and the glacier destruction north of california in the glacier national park. >> they finally did get rain and about two feet or 18 -- or eight feet drop in the top area but not enough to get weight back to where they were. >> a great morning must-read. here's adam johnson with the economic outlook. >> martin wolf, economist at the here is what he has to say. interesting lesson for all of us here. an expansion of private borrowing to buy every more expensive houses is sometimes -- is deemed good but an expansion of, boring, roads or railways is not -- none of it makes sense. >> with the flooding in the united kingdom. the tone in the last couple of days is that it is getting worse. caroline hyde has been floating around in a boat. but no joke. >> and tremendous damage to all the infrastructure, from

railroads to the utilities and erosion on the coastline, a real problem. busy, busy morning verrilli front and center, scarlet. the pushback there >> the comcast time warner cable deal. asap cash is helping that well. we will talk about how cheap cash is fueling m&a overall coming up on "surveillance" with our guest host martin sonnenschein. ♪

off in taiwanoing just outside taipei where they are celebrating the lantern festival that marks the end of the lunar new year. >> her family's front yard.

>> we do this every year. >> off of the terrorist in the penthouse. >> you can -- have to see the view from the other side. >> is a correctness of the only landlocked county and city in taiwan, where the water is a distance away -- is that correct? >> it looks like it. it does not matter either way, i want is in a bowl format. >> scarlet fu on taiwan. >> my parents are celebrating. >> wonderful. good morning. "bloomberg surveillance." it is valentine's day. i'm a little confused. i am buying chocolate at 10:00 a.m.. stocks, bonds, currencies, commodities. futures flat. dollar, 1.37. we will talk to hans nichols in rome. nymex crude under 100. let's leave it there. janet yellen not testifying to the senate. back to the big news, but the merger. and this is mr. roberts at

comcast, comcast, they are acquiring time warner cable. it is an all stock transaction. even with that, and implied cash value and cash is cheap. this is wpp ceo sir martin sorrell yesterday. >> it goes back to cheap money. you can borrow money and 30 year bond market like we did last year, three percent net of tax. by something at 33 times early in the best of earnings at least in theory without feeling the whip. long-term cheap money, good management, and opportunities means more consolidation. in sochi.he is out maybe he is watching from the g5. when the chairman of sonnenschein partners. the lubrication? >> comcast was already a fairly levered company. not overly.

cable has a little bit more in terms of debt to ebitda that they can afford this, money is cheap and these deals are able to come together fairly quickly because the debt side of transaction is absolutely manageable. >> new regulators look at that angle? i think what they are concerned with, is it good or bad for the consumer or fair or not fair to the consumer? atwith all the pushback politico with all the major papers pushing back, everybody complaining, fine, what is the mages that's major complaint? >> is it bad for consumers. i did not think it is, by the way. time warner stock is trading well off of the deal price but that is also partly -- trump cardn roberts' -- this is for the global audience -- you have to live in new york to be so unhappy with time warner cable. of the most reviled companies on the planet.

is brian roberts trump card is everyone can't stand time warner cable? >> nor does it hurt that brian roberts himself is a very likable man. he is not a larger-than-life egomaniac. he is actually one of the nicest guys you could talk to. dealsmorning must-read with the idea that it is bad for consumers -- not just to they can choose for the cable writer but infrastructure. view"ticle in "bloomberg at high speed connections are like infrastructure -- she says that comcast will be making less investment in its network because it is not subject to competition. >> i am not sure that is true at all because i think it ignores the reality of competition from satellite and web. comcast has made huge investments. this is a 150 billion dollar market cap company that can afford to. the question is what is fair and unfair and what deals can they

cut with the fcc to get approval. these understand how things get done. help me understand the theerence between department of justice effectively saying to sprint and t-mobile if you guys combine and you have 30% marketshare in no way are we going to make it happen. a squad of the deal before it got going. yet here in the cable industry andringing together comcast charter, same market share, 30%, they have not raised any flags. >> in fairness, there is a healthy debate that is going to be had here and a "wall street journal" op-ed said is fine and "new york times" skepticism -- -- that wall street journal and new york times did not agree. [laughter] >> there is not a bar at a specific percentage point. we know in the 30's some of that is where it feel saturated and that is what you run into problems. and these are two different industries. and the phone industry, you don't have the multiple lines of competition you have an cable.

that is what is different here. >> in other words, there is a directv and dish tv. >> even though they are smaller players and less and less significant. >> there are more modes of distribution, number one, and as i said earlier, cable companies are not competing with the markets. they always it had monopolies in markets. the question is whether 30% on a national level is a difference that makes a difference. >> we need a chart with comcast and time warner cable. an attractive chart will help us on this valentine's day. i am sorry. to the moon. there is the gross at time warner cable out there. we have not talked about -- enough about management of time warner cable that actually has done the right thing for shareholders. they should be taking a massive victory lap. >> i think they are. they got to $160 a share. i think it is their victory lap. i think they are doing the right thing. i think this is a valid vat. i do not think it is like at&t or t-mobile -- i said on bloomberg, i think it was an

over-the-top that and the fact that at&t was able that's willing to pay a 3 billion dollar break fee was silly. i think this is a more realistic bet. >> wearing stripes, adam did not get the memo. >> but i did not know about the red bowtie. >> my youngest brought me this years ago. wearing it fory valentine's day. and if you are doing the right thing, buying a little chocolate fu, chocolate. cost more and it is likely to keep rising. is up ninef cocoa percent, it has not been this excited since of the 11 and the problem is the farmers cannot keep up with a man. a trade group says it is not likely to change for another five years. mr. keene, stock up now. last year the retail price rose faster than inflation. that is a shock. what are we going to do about this, tom? >> i don't have a christmas club

account at my local bank, i have a valentine's day account. it is like a club. you put money aside every week to get ready for the onslaught. our twitter question of the day at "bloomberg surveillance." and massive amount of sensitivity when into this. what are you spending this valentine's day? let's get right to it. it has become huge. it is an extravaganza. and theny card chocolate and flowers. we did not even mention flowers. >> if you don't do anything, you look really bad. -- know, >> you don't want to be the chump that does nothing. >> we are going to look at diamonds and champagne later. >> also, another day and another change in italy's government. prime minister and enrico letta is resigning and italian bonds arising. we will get you caught up on all the latest out of italy next. this is "bloomberg surveillance ." ♪

>> good morning, everyone. this friday morning, it is valentine's day. don't forget it. i'm tom keene bit with me, scarlet fu and adam johnson. mr. johnson did not forget valentine's day and he has top headlines.

>> bangkok. right police and antigovernment protesters clashing as the police moved to take them derek is that it can set up around government offices. blockade have been in place for weeks as of the government complex and other points around the city are dealing with the fact that these protesters are trying to force thailand's prime minister to resign. moving slightly north to china, where inflation remains a stable last month but consumer prices rose 2.5%, the same as we saw in december. food prices gained 3.7%, however, the smallest increase since may. china's economy can be distorted in january and february due to the week long lunar new year holiday that began january 31. things data and chinese taken with a grain of salt. yesterday was opposed to be the worst air travel day of the winter so far. about 7000 flights were canceled as ice and snow battered states from georgia to maine. i don't need to tell you that everyone is aware of it. so far, 75,000 flights have been

canceled due to the strangled winter storms, according to a flight tracking service. those are your top headlines. seeeally beginning to comparisons in the greater new york area to hurricane sandy. the impulse and the amplitude of the tragedy was great but the flights are becoming a big deal. we have a single best chart with an appendix, an addition, and that would be adam johnson. >> for we actually show you the single best chart i want to show you another chart that sets it up. legendary market timer created this as sort of a fun chart, a comparison of a prime discussion showing the current market versus 1929. he never intended this to be a series chart the people took of the series. >> it is in and along chart where you just see the absolute values. thesingle best chart put to comparison into context by spotting percent return. the single best chart is from,

and roche who published it on his blog pragmatic cap of -- pragmatic capitalism. dow jones industrial average in percentage terms and the yellow line that showed what happened over the last two years. certainly that shows we are nowhere close to what happened in the late 1920's. >> this is a law and analysis, henry briggs dying in 1630. -- this is a log analysis. >> so, don't panic, anyone. not on the verge. >> when in doubt, go to logs. the eurozone, europe, their growth is back, i guess. the currency bloc find its footing. investors cheer, fourth-quarter pickup. euro moving out to 1.37 and some could -- suggested to go stronger. he is on a roman holiday, doing a gregory peck imitation, chief international correspondent hans nichols. this is good news for europe. marginal good news.

these are rounding area -- errors. france, 0.4% versus 0.3, -- if he wants to understand the european economy, take me oder river that divides germany and poland, take it south along the danube and everything to the east around one percent and everything to the west, less than one percent. the question is, is germany part of western europe or eastern europe? the growth the story is in eastern europe? -- the growth story is in eastern europe. >> i counted 11 political parties in italy. i believe we have two in the united states. how can anyone govern with 11 political parties question mark -- parties? >> gelato, everybody has gelato before noon and everything is together. this is napolitano's town, napolitano has to have consultation with all 11 parties. he has those parties. he will receive letta's resignation in about an hour and

then he will cobble together some sort of religion. obviously the most likely candidate. after that, they have to figure out who gets the finance ministry and who gets all the various ministries and then they can start to try, as you point out, govern from a minority position. until you have a strong election result, it is going to be hard for any party to govern in italy. you simply don't have a mandate from the people. italy the people in engaged in this moment or are they just worn out and tired of it? >> there's a little fatigued, right? but i think the more important thing -- and this is the question for matteo renzi, who will be the new prime minister -- does he have a democratic legitimacy? he is the third prime minister, if he takes to power, who will be in that position without being democratically elected. remember, this is the mayor of florence, a lovely town. nothing against florence. . town of 336,000 people he will now be the prime

minister of a country of 60 million. >> thank you so much. try to get back to berlin in one piece. if you see audrey hepburn, say hello to her. hans nichols, our chief international correspondent. how did he win that? >> that is a very impressive title. but you are coming back? >> something of an a to point out because here's the market take of what he just told us. the 10-year in italy is 3.70, 10 basis points worse than state. -- intense pain. in spain, 3.60. a big deal. the fact that italy is in worse shape then spain. >> maybe they can make mario draghi the new president. >> i am sure a lot of investors will like that. coming up. it is valentine's day, after all. shopping for a diamond ring got a lot easier. trends emerging in luxury. we will get you up to speed. right here on "bloomberg surveillance." ♪

>> i'm scarlet fu here with tom keene and adam johnson. let's get you some company news from the files of "bloomberg west." sony grabbing the lead in the

videogame console wars. combined sales of the new lay station and its predecessor were better than all other gaming platforms, all this according to research firm npd group. job own raising 300 million dollars, the maker of web jawbone. devices -- one of the largest investors in twitter may lead the financing. pandora is set to rollout a new ad servers leading political organizations target list and is based on the music they listen to. the service will match election results based on zip code with music choices of subscribers in the zip codes. that is today's company news from the isles of "bloomberg west." what do you listen to and what will they find out? >> i listen to basically country music and jazz. >> what platform? iradio and i am buying more music. it is the gift. >> you go to the radio, i like

that, and then you click a button, and you own it. >> way too easy. lexi get the bill -- i bought 18 songs? >> not like 50 years ago and trying to get the courage up, for $.86 to buy a beatles 45. >> all about dimples purchases. let's have a -- >> let's have a moment of silence for yours and my pocketbook. scarlet fu. >> i am still waiting for the chocolate, but it did get a lot easier especially if you are splurging on diamonds. a company is changing the way we buy the stones. it was founded 15 years ago as a hotel entity. the emerging clicks and brics trend. mosti is called one of the promising company the 2014. brian, welcome to "surveillance." the sabr how it works. it is not just disrupting the diamond and jewelry business but also forming partnerships with existing stores. >> ritani is a leading designer

of -- and manufacturer. clicks to brics. -- bricks. one-of-a-kind piece of jewelry. an option, shape it like a regular e-commerce transaction or ship it to a local independent we tell her where they can walk in obligation free in a safe and secure environment and make the purchasing decision. the holy grail of retail today. >> a distinction here is that people buy diamonds differently than, say, how they buy books or shoes or clothes. most of the purchases at the end of the day have to come at a store face to face with a customer service person, right? >> yes. diamonds have been online for a while now, but when you really talk to the consumer it is a very tricky process because you want to touch and feel the product. you want to see if it sparkles. >> how much are you going to save me? 40% by shopping online

but then when you integrate the local jewelry store you get the best of both experiences. you can get the price and selection on my competition has. mylet me translate that into world and adam johnson's world. start lower down fifth avenue, we work our way north and it is outrageous until you go to the diamond district and all that. am i still going to the diamond district or will i go to you? >> new york has always been kind of a unique market because it has 47th street and the diamond district but you want to come someplace and ago stress-free, obligation free, walk in and get educated. buying diamonds, we don't make it easy in this industry. when you have a website that takes the pressure away and you get educated first and you can see the entire selection, you can make a more informed decision. >> you talk about partnering with the jewelry stores. what is in it for the jewelry store? why introduce you, a competitor

into their own stores? >> we don't look at it nearly as a competitor but truly partners. 90% of all engagement ring purchases start online. less than 10% actually end up online. you are looking at the rest of the consumers aware they are going, they are going back to the retailer to make a purchase. our goal is to have the brand we arehe -- ratani -- bringing a customer in. when a customer buys an engagement ring in a jewelry store there is a 50% chance they will come back for the wedding ring in the lifetime value is precious. imagine it is a retail store, i have a qualified customer i will drop into the store. how much do you want to pay me for the customer? fascinating is there is a fragmented market for a diamond engagement ring, all the fine jewelry. the use jewelry seller in the u.s. as walmart, tiffany only has one .5% market share. independent julie stores are

fairly resilient. martin sonnenschein, in mna, does it prevent an opportunity? >> i think what brian is describing is very cutting edge but we did a deal years ago, where we put one-800-contacts inside walmarts of the foot traffic would end up on the web. we still drug store.com to walgreens so their foot traffic would also use more of the website. i think it is on the right track. i just bought a pair of glasses. happen to be available in england but i want to the website, went to my optician and said would you order this, and he got them for me. >> do i need a trophy ring or is it a more subtle age? >> i always go back to classic diamond jewelry. diamonds studs, pendants, bracelets. of the key thing for a jewelry purchases by something she is going to wear. be ais not meant to collection piece in a museum. we wanted out in the open. >> can you explain it to me why it is a tennis bracelet and not

bracelet?rasileira -- >> it rolls around on your wrist. >> yet to go back to chris evert in the 1970's and 1980's, she used to wear a diamond bracelet and it became nicknamed tennis bracelet. >> i never knew that? >> this talk of diamonds kind of freaking me out. [laughter] brian watkins, thank you, president of ritani. >> let's do a forex report to figure out how we can pay for the next diamond ring. a stronger dollar-yen. euro-yen, is what the pros look at, the euro, 1.37. or olivia sterns, on her way to sochi, the ruble basket, she will be able to buy suntan lotion in sochi. >> she's going to need it. it is 60 degrees. >> getting up to 70. our guest host also, martin -- marshall sonenshine. hour onp in the next

television and radio, a new m&a deal, just of a bank agreed to by eddie bauer, we will talk about it right here on "surveillance." keep it year. ♪

>> this is "bloomberg surveillance." >> just say no, a pushback

begins against the consolidation of your cable industry. comcast and brian roberts higher lobbyist. speaking of mr. roberts, well, scarlet fu already watched the first episode of "house of cards." it is a cynical washington. in davos, adam johnson find value in -- you and me and want -- at lunchtime will be in champaign. live from our world headquarters in new york this valentine's day. i'm tom keene. joining me, scarlet fu and adam johnson. our guest hosts on winter -- the storm, the weather. burt flickinger joins us, managing director at strategic resources. >> there is a lot to talk about. overnight the euro area economy expanded more than forecast in the final quarter of 20 14, easing pressure on the ecb to

take action. france, thermany, netherlands as well, they all beat the gdp forecast. they were not up a lot but they .ere are -- up ok, time, by the way? if you need to cough. >> that is what i got for valentine's day, ricola. i am of you on radio, fighting the plague like the rest of us. would you please continue? consumer prices rose 2.5% and producer prices fell 1.6%. mixed they'd obviously in china. economic data here in the u.s., at 8:30 p.m., import prices. more important, 9:15 a.m., industrial production. >> weather affected. >> big time. and capacity utilization, how much they are operating. michiganversity of confidence. earnings today, only a couple. before the bell, cody and campbell soup third >>

incredible news flow. here is company news. >> we start with job cuts at aig, eliminating 1500 jobs. these cuts will come from the property-casualty unit and will reduce earnings by 260 $5 million before taxes according to the company. malone's liberty global, reporting fourth-quarter sales that came in below for johns -- a miss malone's liberty global. sales grew 71% thanks to a string of acquisitions including a buyout of virgin media, but john malone struck out where he wanted it the most, time warner cable. this just broke in the last hour. joseph a bank is a deal but not with men's wearhouse. it is buying the eddie bauer brand from private equity firm golden gate capital. $825 million in cash and stock. they believe the deal will add to earnings immediately. we will get back to that deal with gilbert harrison, chairman of financo, who helped advise.

towas looking for this happen. that will come up later on. >> the cable industry front and center today. monopoly or no monopoly, that is the debate. this, of course, is comcast, and time warner cable will make the two giants of the american industry. the belly and company on cable tv and media, he is joining us from new york -- the focus at gabelli and company. is there any way the government can block it? >> there is always a way the government can block it. but there is no statutory barrier to this transaction. the assumption is bigger is badder and that is not necessarily the case but certainly the fcc will look at a hard and they will take their pound of flesh, that is what they do. >> obviously comcast is being proactive. what is brian roberts's to do mollify allfy --

editions? >> it reminds me of four years ago when they made the offer for nbc. that in my opinion was a much more controversial deal him a vertical consolidation. they got out ahead of it. they offered to extend the commitments they made an nbc deal to time warner cable subscribers. very powerful lobbying force in washington and they will be busy. >> chris, you tallied a list of winners and losers. clearly comcast and time warner cable benefit big-time looking at the share price. what about the loser side? with very came in good organic growth prospects, terrific management and they have a opportunity to benefit most -- benefit most from an increasing scale and the best way to get to stale -- to scale was to buy time warner cable. does not look at what happen although i would not totally count them out. they will have to go back to the drawing board and maybe do it in pieces. today asot look great

it did a few days ago for chartered. >> comcast historically raised prices about six percent. is that going to be a negative for the sec -- fcc as they look into this? company certainly has pricing power on the broadband side and they have been fairly disciplined in that and they offered a course more and the way of services for those price increases. they will have to balance that. cablely grail for investors is to price on a usage basis. washington, the balance between the haves, the sophisticates, who have all the fancy toys including broadband and high-speed internet, versus too large a part of america which is going with all time media speed. who will the politicians listen to? obamaocus of the administration certainly was extending broadband abilities to all. that has been happening.

rock band penetration obviously has been increasing. comcast has made an effort to make sure it is available to set -- lower and individuals. that will be big considerations. >> thank you so much, greatly appreciated. etc. set -- terrific perspective. burt flickinger is with us. he waded through two snowbanks to get here with the ugly weather. we will get to that in a bit. the news this morning, joseph a bank. to me, joseph a bank is nestled near paul's the word high-end and brooks brothers hot -- hi anne, so who is joseph a bank and why do they need to train wreck known as eddie bauer? >> the reason, joseph a bank going back to ray bank and his father, is in the best private label brand. eddie bauer has brands. it is a train wreck. doing a little bit better since the financial crisis but you need to companies to increase growth. only haseph a bank

several hundred stores in the u.s. with eddie bauer. you get more real estate, negotiating power. >> real estate and combining private label with brands. >> i kind of think of you at chinos -- in chinos. >> i usually wear jeans on the weekend. >> what about the notion, joseph a bank back in a sober made a bid for men's wearhouse admin bid -- men's wearhouse made for joseph a bank. is this just of a bank saying we will buy eddie bauer so we will make ourselves unattractive to you, men's wearhouse, because we are changing our ammo? correct.e completely this is the private label poison pill because the best thing for investors and shoppers is men's wearhouse buying joseph a bank. >> just, men's wearhouse, go away. >> you think they maliciously did this so men's wearhouse daschle is at "house of cards?"

frank underwood. i think of thek, great deals on the suits, by tenant by 17. >> know, scarlet, walk in the store and get two free. discounted byres 20, 30, 40, 50% -- did he get them anywhere? >> it did not get them anywhere in the cost of cotton and rayon and all the other fabrics going up, so joseph a bank will have higher costs, more margin pressure. scarlet's point in women's fashion, they are still clearing out the winter stuff now. -- in yoursystem many decades, is 2014 a critical year? is it a transition year for retail? year ands a transition it will be a retail recession in the lower and mid tier, jcpenney's, sears, eddie bauer's of the world but it will still

be good on luxury. for most the retail, walmart is negative the entire year and many others as well. >> the cfo out the door i jcpenney. a big deal? >> not a big deal because jcpenney still having receivables factored. many are worried jcpenney will not make next valentine's day. >> exclusive. >> noteworthy. jcpenney may not make it four-year. >> you know who will make it the next valentine's day? frank underwood. season three "house of cards." season two actually began about four hours ago. said, youon it and i know what, if i start this i would not be able to make it to "surveillance." for netflix, the stock has gone up 160% since house of cards debuted and the subscriber numbers have risen as well. netflix said in the same breath as hbo, the company netflix wants to be like.

a lot of analysts said as long as netflix continued to develop this original programming, this is the future for the company, and it has a good in with both the ford cutter pocket -- cord cutters and those will never cut the cord. >> you know what she will be doing this weekend. futures up to, dow futures up 21. coming up, we will look at champaign because it is valentine's day -- champaigne and it is in the vicinity of our twitter question. the only thing free today. what are you spending this valentine's day. you miserablee this friday. >> we want to make you hot -- happy. >> flowers, champagne, chocolate, take your pick. ♪

>> the morning, everyone. i'm tom keene. time now for this matters now. our guest host, burt flickinger. spring cannot come soon enough. --gdorf, saks, nordstrom toblem is, you cannot get the store. the weather is profoundly affecting retail. we saw it yesterday in the economic data. mr. flickinger is retail and dual -- analyst at strategic research group and he is moving to miami after what we have

seen. have you ever seen a winter like this? >> never seen a winter like this. but we were at the mall of america, so in the frozen hundred of the shoppers get to the stores, but not in most of america. and 59th street, the puddles of water by the curb were wide as lake erie. you cannot get to the stores. how ugly will it be and how big will the discounts be march and april? will move to desperation. on 5th avenue, shoppers are still not going to the stores, not even h & n and the lower-priced -- h&m and the lower-priced retailers. you will have higher vacancy rates. shopping center owners will have a tremendous amount of problems. he anchors like pennies, sears, kmart struggling financially's. anchors like jcpenney, sears, kmart. credit watches as well. >> spring -- fashion week in new york and all that -- is bring a big deal in fashion? >> spring is a huge deal and

fashion. as bloomberg reported, we had fashion week in new york dared what is really concerning about the winter weather is apparel was down in the u.s. department of commerce report yesterday, where it should've been the best of times for peril, the worst of times. >> who is getting it right? checking in the malls and see what is moving. who right now, even with them weather, is doing better than good? and his lundgren merchants at macy's, my macy's, macy's.com, nordstrom's and nordstrom.com, those are the real winners. for valentine's day, tiffany's way up. hermes, bur barry, john lewis the u.k. doing exceptionally well. >> i look at this and that is all about women, women, women. what is a valentine's day gift for men right now? what would women be buying for men this valentine's day? >> women may be buying champagne. -- who alsot of

wrote french women don't get fat -- recommends grand dame. >> if i drink -- however you say it -- i don't get fat? >> she never got fat. she looks great. >> burt flickinger exclusive, champagne is good for me. we will talk about that later on today. but coming up, seriously, our chief international correspondent hans nichols is in rome. italy and turmoil? good morning, everyone. it is "bloomberg surveillance." ♪

>> good morning, everyone. i'm tom keene. with me, scarlet fu and adam johnson. >> getting right to it. top headlines, here you go. europe's two biggest economies top growth forecast in the fourth quarter. gdp in germany grew 0.4% and france both best posted a 0.3% gain, both better than forecasted exports helped drive germany. in france, it was a pickup in domestic consumption.

yesterday looks to be the worst air travel day of the winter so far. about 7000 flights were canceled as ice and snow barreled up the east coast, from georgia to maine. so far this year, 75,000 flights have been canceled due to all of these winter storms, according to flight service tracker. president obama is offering millions of dollars in aid to california farmers, ranchers, and communities hit by one of the worst droughts in history. it forced farmers to leave thousands of acres idle and the state may have to truck in drinking water for some of the rural communities. the president will detail the package later on today. held ineather, california, very, very important as well. scarlet, on retail. an hour ago.ounced joseph a bank buying eddie bauer in a cash and stock transaction worth $825 million, as those of a bank fends off a merger from men's wearhouse.

joseph a bank one of men's wearhouse and men's wearhouse wanted it back. got invited to just of a bank on the phone, mr. harrison from financo. -- whether this deal is a defensive move aimed at fending off any further overtures from when -- from men's wearhouse? is that the case? >> good morning. first of all, i totally disagree with what he said. you will note in the press retained inere february 20 12, 1 of the first companies we called it was -- eddie bauer, because we believe they fit with -- a fit with eddie bauer and joseph bank was superior. it was a growth business. taken over by golden gate after bankruptcy. all of the attributes of that joseph the bank has in terms of managementent -- the

-- >> ok, but gilbert, you represent joseph a bank. i understand that within your long and lengthy career. are you saying eddie bauer is not a brand that has been a train wreck for a decade? >> it has had its problems. they hired the guy who built also -- into and tremendous opening. he and his merchants are great people and great marketing people. be team is going to fantastic. >> what, gilbert, is eddie bauer doing correctly now that makes it so attractive, in your opinion, to joseph a bank? >> they have gone back to their roots as an outdoor company, a sportswear company. they also have children and men's. it is going to give joseph bank the ability to expand into new categories, gain an international presence. and there are meaningful cost synergies. stay with heritage,

us. burt flickinger, i want you to reply. -- gilbert harrison him stay with us. or click injured, are you seeing better traffic and merchandising at eddie bauer? >> eddie bauer heard by declining customer accounts, shopping malls across america and retailers spending less. correct, the manager coming from columbia will help that -- merchandising. objectionsbe no ftc on this one, where there will be averal objections -- this is clean deal. >> this is joseph bank in eddie bauer. gilbert, respond to this, please. respond to- you to the idea that the transaction and men's wearhouse hangs over this and an arch. how does men's wearhouse fit into what we see this morning? things, first of all,

when we agreed on this deal, our agreement gives a right to terminate the agreement shows men's wearhouse comes back with an unsolicited offer that the management and the board of is superior.eels they have a fiduciary duty. we have met, we have discussed this. i think it is very important to note that men's wearhouse would bring initial synergies. but after two or three years of the synergies, you will have the slow growth. eddie bauer, if they continue to do what they do are doing, they were up 16% in december. if they continue to grow, the opportunity for stock appreciation in this company will be significant. so, i think you have to take these two things into account. what is specifically the message from joseph a bank to men's wearhouse right now -- gilbert?

>> we made an offer back in september with a 46% rhenium. we did it on a friendly basis. 26% over their five-year high, 42% over the price the day before. they waited two months to come back to us and they trashed us. they said we were a terrible company. they raise antitrust concerns. in a turnaround with his pac-man defense, which i talked to tom about before -- and then they turn around with this pac-man defense and they say it is not antitrust. we got subpoenas from the ftc and so did they. there is a real chance of the deal may never get approved. >> gilbert harrison, appreciate your efforts. and we should repeat again that mr. harrison does work for joseph a bank and represents them in his transactions. >> and he pushes back of the idea it is a defensive move. >> can i buy one and get six bowties for free? now you've got -- >> with men's wearhouse and joseph a bank, you combine

off-price the same way tjx did marshals and tj maxx. to continue with our valentine's day theme this morning because, coming up, which champagne is worth the splurge tonight? we will talk about the best bang for your buck. ♪

>> good morning, everyone. "bloomberg surveillance." i'm tom keene. with me, scarlet fu and adam johnson. we hope you have a good valentine's day. there is so much going on this morning. futures up one. dow futures up 13.

we need to go back to italy. a lot of news. hans nichols, our chief international correspondent, happens to be in rome today, the challenges of the italian government. that and news out of the eurozone. -- better news out of the eurozone. buttressed up against this. all of global wall street got this wrong last year. the euro ever strengthening. eurouch is the stronger beginning to affect germany, beginning to affect italy? you did see the stronger euro eat into profits as you sell corporate earnings for the last two quarters. ask for -- export reliant countries like germany are typically heard by that. you did see it happen. you see markets rally. it is a psychological effect. the growth that we saw in fourth quarter gdp was not significant. it is not going to be enough to turn around. here in italy, youth unemployment, 40%.

want to go.hat adam johnson talking about this the other day. the idea of the chronic euro-sclerosis. what is different this time in italy? is this just another government change, coming out of the 50's and 60's? or is there something new this time? somethingnow if there new. certainly something younger and fresher, the name of the person matteo renzi, current mayor of florence. he is only 39. you know, i am tieless in the shot, as is randy and most of his tv appearances. there's something about him that is invigorating. investors are cheering him. they like the fact he may take on the old guard in italy. and that is an entrenched political system but also an entrenched bureaucracy. the civil service here in italy has so much strength. if a renzi can figure out a way to challenge and reform that and modernize that, you can see how it really might make structural changes to its economy, lower taxes, loose that's it loose and

labor regulations and finally start growing. that is why investors are cheering. but again, he is young, untested. he has gone on from being the mayor of florence to being prime minister. comparisons are already starting with tony blair, how he reformed the labour party in the u.k.. was fixated on youthfulness and he surrounded himself with young people and now you have matteo, 39. it isn't about that believe that you have to be young to be in power -- what is it about italy that you have to be young to be in power? >> i only heard part of the question -- but i figure the brilliant part about berlusconi. the power is intoxicating. instead of trying to bluff my way through most of my tv hit i simply immigrants -- lead ignorance and plead the fifth by gesticulating like italian. chiefg repacked is our data greg repacked -- gregory p

eck, our chief international correspondent. what are we doing, sports? year.ical time of the magazine guys love and librarians hate. you know what i'm talking about question of the annual "sports illustrated" swimsuit edition. marking the 50th anniversary by putting three -- three abbottabad 1 -- three models on the cover. time there first have been multiple models on the cover in eight years. the picture was taken on the cook islands off the coast of new zealand. what do you make of that? >> i would beg it looks ok on bloomberg radio but i think on tv -- >> it is gratuitous. thinking hr am just violation all over the place. >> we are doing it every year. the series point, with the magazine industry flat on its back it meant money.

>> the whole thing was thought of as a way to bring in advertisers in what is traditionally in no time of the year. the super bowl is over. a finaly we are not yet 4 -- >> baseball season has not begun yet. to inject life during a follow period. they just made it up. let's put a girl with a bathing suit on the cover and a jumpstarted sales and after that they did it every year. >> but it is so sad now, that that is all that is left of the magazine. the entire industry is really struggling. >> media in general agreement itself. that is why bloomberg tv is on your iphone and ipad. >> what a shameless plug. >> that was very slick. i like that. ,e just went to hans nichols and, scarlet fu, as you begin the data check, i want to point out, the euro, 1.3709. >> stronger, and on the back of the gdp data out of europe. in the u.s., we have import

prices coming up this morning at as well as industrial action and university of michigan confidence declining for the month of february. not affecting futures right now. futures indicated to open higher, up by one point. >> good morning, everyone. "bloomberg surveillance." i'm tom keene. we are on bloomberg television and radio. all of our interviews out of bloombergtv plus on the ipad bloomberg radio plus itunes android. scarlet fu with us. burt flickinger with us on retail and the winter weather on the east coast. words like injure with strategic resources. -- burt flickinger with strategic resources. be spending may cautiously the season but not getting the way of their buzz. we are focusing on the alcohol of choice, champagne. we turn to the master of wine ,erself, jennifer simonetti

happy valentine's day. >> i like the red tide. >> very apropos. >> in the holiday spirit. >> for those on radio, a solid red tie. to matchpper jennifer's red dress. valentine's day, how does it to, say,or champagne new year's eve. footie percent to six percent new year's, 40% to 60% of sales but after that, valentine's day. rose champagne. >> it just looks different but does not taste different -- >> it does taste different. is cleopatraegend

seduced julius caesar with the, that is sweet, it has raspberries in a. and i ask a dumb question? --they run out of champagne with all the sales in december and then in january they were now? out., they don't run the 2013 harvest is lower so there is a supply and demand issue. the demand for champagne probably is never going to go out. around the world, rosé champagne is about 10% of the exports and in this country we represented about 17% of that. it is very, very popular, but there are some brands that are worth it and some brands may be not. >> champagne is one of the things people will be splurging on this valentine's day. flickinger, you have done research on how much people are going to spend this year. >> what we found was shocking. women will spend less than $50 and men will spend $108.

to jennifer's point, a lot will be spent on champagne and quite a bit on experts. french champagne sail down to the lowest since 1977. o what we're saying is non-related linenger -- f lickengerwines.com, rosé doing the best and domestic -- >> united states went up -- >> which we have to call sparkling wine. but champagne sales in the united states. >> how do men choose their sparkling wine versus women? your point,an, to want to spend a little bit more money, which is the reason why they focus a little bit more on champagne and rosé champagne, and my husband favorite is charles -- rosé champagne, aged

for a long period of time, $80 a bottle, it is lovely. >> which champagne should the president have toasted president hollande with at the state dinner? which would you have selected for the president to make that toast? >> there is a lot of times of the white house -- and i had been there a lot of times, and i have seen their seller which looks like the closet. --they always tried to use the connection with the country they are entertaining and something at home. that was related to france so they probably would use -- >> that would be the politically expedient. >> probably the best way. >> have you tasted cold duck? >> less than three dollars a bottle. i have. where comes from. it is a german name that originally -- duck saysold

valentine's day for me. >> it is red and sparkly. >> happy valentine's day. our twitter question for the day, what are you spending on valentine's day? tweet us @bsurveillance. ♪

>> good morning, everyone.

coming up -- an important interview -- howard marks, chairman and cofounder of oaktree capital management "in the loop" at 8:00 a.m., describing perspective on the major merger of comcast and time warner. 8:00 a.m. hour. this is "bloomberg surveillance ." i'm tom keene. with me, scarlet fu and adam johnson as well. freeed to look at our photos of the day. >> i'm going to kick it off with number three. plane atash shrouded a an airport in central java in indonesia. here is what is amazing about this. the plane we're looking at right now is 93 miles away from the --cano that developed it iraq it and spewed all the ash bid the could be heard about 125 miles away. a lot of people impacted 33 international airports closed at 100,000 people evacuated. one of more serious note, two people died as a result. >> gestate today, week to week,

a bigger issue. week to week. >> i spoke to a pilot went to fly through some of the ash and it completely sandblasted the windows so they had to land -- >> remember when the icelandic volcano erupted, it totally disrupted travel in the european continent? people were driving from the u.k. -- >> photo number two, a resident cross-country skiing outside the u.s. capitol. taken yesterday. looks like in the middle of minnesota. >> am not a resident, that is still mattingly on its way to the office. >> a tough one. grounding more than 10,000 flights but that was the big story yesterday. >> and the government, of course, had a snow day. >> the government has a snow day every day. [laughter] way, one person in particular -- ok, not a person, we can blame for the stacks of wtawneyy phil -- punxa

phil. he did see his shadow. indicating six more weeks of winter. phil is said to be cooperating with authorities and promising a beautiful spring. a mug shot. >> it is getting a little old, isn't it? many have we had? >> 16. >> 81 major snow event according to the highway. >> we have a major morning move or even. >> weight watchers losing a lot away this morning, dropping, double-digit percentages, after giving an outlook that missed analyst estimates. weight watchers down by almost 22%. $24 a share. i have never actually used any the programs and do not know anyone who have a wet wet -- who have -- >> i have not, either. >> just don't eat. i had to cut 25 pounds for wrestling season. >> you also fit into a cup and

wrap yourself in cellophane. we have more coming up on "bloomberg surveillance" as well. we will continue to look at the big deal that broke this morning. joseph a bank buying eddie bauer. what was the last item you bought from eddie bauer? can you remember? >> wells said. 1985 -- a duffel bag in 1999 to hold my hockey equipment. we will be right back. ♪

>> good morning, everyone. "bloomberg surveillance." it will be front and center -- i will be a here on monday, no one else will, but tuesday, david , former obamafe campaign manager. this is "bloomberg surveillance" on a friday. it is valentine's day. with me, my valentine, scarlet fu, and adam johnson. you are not my valentine. scarlet is. having champagne later. burt flickinger here as well. good morning to everyone. >> we have to go back to that bill -- big deal that was announced yesterday. comcast and time warner.

tens of millions of dollars. >> and washington, where -- tens of billions of dollars worth. >> and in washington, arguing about the value of this deal for the american consumer. i think of ed markey of massachusetts who has been leading the way on this. how ed markeyish is washington this morning? >> something i have been paying attention to since the deal was announced, there are pros and terms of companies that know how to navigate washington, and then the elites, and that is what comcast is. i have about 35 firms on retainer to lobby both agencies and capitol hill. won a million dollars on lobbying. hundreds of thousands of dollars of campaign donations -- $20 million in lobbying. hundreds of thousands of dollars in campaign donations. judiciary committee -- comcast is plugged with all of them. they can put a ton of pressure on regulators. >> $20 million for lobbying for brian roberts and $8 million for

time warner cable, $28 million, my working number, are they essentially buying our representatives? >> they are playing the game. they may not -- you may not like the game but that is of the game works. if you like they're doing what they need to do on the business side to make things happen. if you don't like it, take the money out of politics but as long as money is there, any company like comcast or any major enterprise feels like this is the only way to play, and they do it very well as evidenced by the nbc universal deal, a roadmap that i think they will follow as they pursue this through the regulatory thicket. >> what i find interesting is brian roberts as ceo of comcast has spent the last five years making friends up on capitol hill. he sits on a couple of different boards. he is a member of the presidents council on john's. you know he probably is some kind of in with somebody in washington. >> $28 million sounds like a lot of money with me.

how does it compare to, say, telecom where obviously doj squelched the t-mobile deal? million is very big. compared to the industries that spend the most on this like banks -- jpmorgan, goldman sachs, they are all under or right at $10 million. being over that right now, that is a huge deal. the firms they have on retainer right now, they literally are former staffers of the justice department, the ftc, fcc, every member, every top member of every subcommittee on capitol hill -- >> is anybody representing somebody spending $150 a month for cable tv? >> there are. you look at the opposition already out from group -- from groups like common cause and things like that, there are people on the other side of the deal and i think that is what you are going to see right now, the tug of war.

there is a democratic chairman of the fcc right now who is very concerned when it comes to this deal. in particular what you're going to see broadband access, what it does for pay tv models. those groups have a big say when it comes to the democratic members of these commissions of those groups actually have more of a voice than you think they would. >> what is amazing to me is time warner cable is such a hot commodity. everybody seems to want it when, burt flickinger, when a customer satisfaction at time warner is not high. customers time warner cut cable. the brian roberts and comcast employees gave over $6 million in campaign contributions last year. burt, a real problem but what is happening at the lower end. you said consumers at the lower end are not spending. so why are they willing to spend money, $150 a month, on cable? >> they are not.

and they are moving to netflix, which has over 30% of on-demand video. they are moving to youtube, close to 20%. and comcast just lost a significant number of subscribers as well. so, it is a real battle to have net neutrality decided by the federal government on this deal. to tom's point, who is representing consumers paying $150 a month? >> talking about the doj as a revelatory optical -- obstacle. what do we know about how the sec is positioned for something like this question mark there has been a lot of change in membership -- would you know about the fcc position? >> one who was with the universal deal, now working for comcast as a lobbyist. it will be interesting from a tom wheeler perspective. but on the antitrust side, the eld index, doj has been

active but inside baseball, bill baer in private practice work on the nbc universal deal and he is running the antitrust division for the justice department and he has been with them in the big rise of activity. it is unclear whether he will have to recuse himself and whether they clears the way for the ftc to take the lead role instead. obviously the justice department has plenty of lawyers. er is not necessary for them to go after this case but he is a big-time player. insight intongly, the justice department that department of justice. >> like "house of cards." >> because mattingly is such a cynical person. atyou know what jumped out me what he just said, $20 million and jpmorgan spends $10 million. spending three times what a jpmorgan spent on lobbying. >> i urge everyone to read kevin

russo's article in "new york magazine." >> the stories shaping the day. >> joseph a bank. that is the deal. joseph a bank, if you recall, made a bid for men's wearhouse and men's wearhouse made a bit footages of a bank and now joseph a bank says we are going for eddie bauer. what is curious about the deal, with all the news, joseph a. bank is reiterating the numbers, actually below the analyst consensus estimates. looking for some kind of wonderful accretive deal helping joseph a. bank make money, burt flickinger, it does not appear this is it. >> to tom's point this valentine's day, eddie bauer is the bad bridesmaid in terms of the business deal. >> on my agenda, i have to go back to frank underwood or claire underwood -- "house of cards" made its second season this morning, and if he

actually got up early like phil mattingly did, he watched one episode already. this is a big deal for netflix of course because original content is the direction it needs to move in because it pays so much to all the other content producers for the content five years at a time before it expires. >> you really think -- i have not watched it. >> seriously, tom, of all the , orangesownton abbey the new black, this is my favorite. can speed through it in your limited time off and get it done in a day. >> it is valentine's day. we make jokes about it but it is a lot of fun. and i would point out particularly for kids, my favorite valentine's day of the day was one of the offspring of one stephanie ruhle who was out on social media and he looked so proud of his handmade valentine

by the girl down the street. stephanie ruhle needs to curb our offspring. they are already out there swooning women. >> boys will be boys, tom. and you will be out there doing some of that yourself a little bit. >> nope, nope. >> we asked everyone on this valentine's day, what are you spending this february 14? some answers here -- a good husband. >> good over -- get over it. that guy is going home alone. time and effort, a good answer. little bit noncommittal. >> national retail federation is reporting that 46% of people and not spending and of the spending, 21% for teachers and almost 20% are for the pets. >> teachers and pets. >> valentine's day present. well for --

>> lovely to have you here particularly with the joseph a bank merger with eddie bauer as well. never boring. >> never boring. men's wearhouse shares are down, she pointed out. a bloomberg radio -- we continue on bloomberg radio, internet, ♪ and television. ♪ ..

them alive from bloomberg world headquarters, this is in the loop on friday, february 14, happy fellow time stay. i am matt miller. i am stephanie ruhle.

happy birthday to my husband. i don't have to be nice to him two days a year. of people who are married, we have the ceo of cheating website joining us later in the show. here is what is happening in the news at 8 a.m.. >> futures are up slightly. minister plans to resign, bowing to pressure from his party. if the s&p closes higher it will be the sixth gain in seven days. months, twitters .ockup and time to so nonexecutive twitter employees will be able to cash out, leading to a total of 10 million shares hitting the market.